On February 9, 2026, the Department of Justice (“DOJ”) took unprecedented action by filing a complaint under Section 721 of the Defense Production Act of 1950 to enforce President Trump’s July 8, 2025, Executive Order “Regarding the Acquisition of Jupiter Systems, LLC by Suirui International Co., Limited.”[1] This Order barred Suirui Group Co., Ltd. (“Suirui”)—a Chinese firm—from acquiring Jupiter Systems, Inc. (“Jupiter”), a California-based provider of video communications hardware and software, and demanded that Suirui divest all interests in Jupiter. DOJ’s move marks the first time the federal government has sought judicial enforcement of a presidential divestment order recommended by the Committee on Foreign Investment in the United States (“CFIUS”).
The enforcement action underscores the U.S. government's willingness to pursue all available remedies when parties fail to comply with CFIUS-mandated divestment orders and signals continued aggressive enforcement of national security-related investment restrictions, particularly involving Chinese investors in U.S. technology companies.[2]
What You Should Know
- The U.S. government will pursue all available remedies to enforce CFIUS divestment orders. The DOJ’s lawsuit represents a novel approach by the U.S. government in enforcing a CFIUS divestment order, reflecting the U.S. government’s prioritization of foreign direct investment laws as an enforcement priority.
- CFIUS enforcement actions can be initiated years after closing. The transaction underlying the complaint closed in 2020, underscoring that CFIUS continues to identify and act on non-notified transactions, even years after closing.
Background
In 2020, Suirui Group, through its Hong Kong subsidiary Suirui International Co., Limited, acquired all of Jupiter Systems, which provides video communications hardware and software to commercial and U.S. Government customers.[3] After the transaction closed, CFIUS identified a national security risk arising from Suirui's ownership of Jupiter relating to the potential compromise of Jupiter's products used in military and critical infrastructure environments.[4]
On July 8, 2025, the Trump Administration issued an Executive Order prohibiting the transaction based on his finding that the transaction posed a threat to national security.[5] The Order required Suirui to divest all its interests in Jupiter within 120 days (subject to extension by CFIUS) and imposed immediate restrictions on access to Jupiter's non-public source code, technical information, IT systems, and U.S. facilities.[6]
On February 9, 2026, after CFIUS granted two extensions of the divestment deadline, DOJ filed a lawsuit in the U.S. District Court for the District of Columbia to enforce the divestment order.[7]
Key Takeaways and Practical Implications
- First judicial enforcement of a CFIUS divestment order. This complaint represents the first time the Department of Justice has filed a lawsuit in federal district court to enforce a presidential order requiring divestiture under Section 721 of the Defense Production Act. The action demonstrates that the government will pursue litigation when parties fail to comply with divestment mandates. Enforcement actions under the DPA are exceptionally rare, likely because companies typically comply with divestment orders; therefore, this case stands out not only for the government's decision to litigate but also for the unusual instance of corporate noncompliance.
- Enforcement of orders involving non-notified transactions. The Suirui-Jupiter transaction closed in 2020, more than five years before the President issued the divestment order. This timeline underscores that CFIUS continues to actively identify and act on transactions subject to CFIUS jurisdiction for which no voluntary notice or declaration was filed with CFIUS.
- Continued focus on Chinese investment in U.S. technology. The action aligns with the U.S. government’s policy efforts to restrict investments by Chinese persons and companies in sensitive U.S. sectors. Companies engaged in cross-border M&A involving U.S. technology assets should carefully assess CFIUS risk and consider the implications of non-notified inquiries, including the possibility of post-closing divestment orders and related compliance obligations.
- Potential consequences of non-compliance. The lawsuit makes clear that failure to comply with CFIUS-mandated divestment orders may result in federal court enforcement actions. CFIUS also has the power to impose monetary penalties for non-compliance with divestment terms, mitigation agreements, and other conditions.
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[1] United States v. Suirui Group Co., Ltd. et al., No. 1:26-cv-369, Compl. (Feb. 9, 2026), available here; see also U.S. Dep't of Justice, Press Release, Justice Department Files Action to Protect National Security by Enforcing President's Order of Chinese Company's Divestment from U.S. Company (Feb. 10, 2026), available here.
[2] See Paul, Weiss, Executive Order Requires Chinese Owners to Divest From U.S. Technology Company (July 21, 2025), available here.
[3] Id.
[4] Id.
[5] Id.; Executive Order, Regarding the Acquisition of Jupiter Systems, LLC by Suirui International Co., Limited, 90 Fed. Reg. 31125 (Jul. 8, 2025), available here.
[6] Executive Order Requires Chinese Owners to Divest From U.S. Technology Company, supra note 3.
[7] U.S. v. Suirui Group Co., Ltd., Compl., supra note 1.
